LLY Eli Lilly and Co

Eli Lilly is a pharmaceutical company specializing in diabetes, oncology, immunology, and neuroscience, with blockbuster drugs like Mounjaro and Zepbound driving rapid growth. Sector: Healthcare.

Eli Lilly and Co (LLY) is an individual stock. The analysis below presents key financial metrics for the company, covering profitability, capital efficiency, valuation, margins, and growth.

Assessing the quality of returns on invested capital, ROIC is 36.81%, WACC is 7.16%, and the economic spread is 29.66%. On balance, the company generate returns on capital that dramatically exceed their funding costs — a rare and powerful compounding dynamic. Supporting metrics show ROE at 102.89% and ROA at 20.10%, a combination that helps frame whether profitability strength is broad enough to hold through different market conditions. Taken together, the return profile suggests a company with credible compounding capacity if current operating execution persists.

The company's current market valuation reflects trailing P/E of 40.77, forward P/E of 27.00, PEG of 1.24. Forward P/E is significantly below trailing, indicating that consensus expects earnings to grow — making the company appear cheaper when viewed on anticipated profits. On a PEG basis, the company screens as attractively priced relative to its expected earnings growth. The current ratio of 1.58 is in an acceptable range, reflecting reasonable short-term financial health. Across multiples and liquidity, the company is priced in a way that reflects current expectations reasonably well — leaving limited room for error, but also limited near-term downside from valuation compression alone.

Looking at margins from gross to free cash flow, gross margin sits at 83.04%, operating margin at 45.56%, and free cash flow margin at 11.46%. The gross margin here is a standout, pointing to businesses with durable unit economics and limited commodity exposure. Exceptional operating margins signal that overhead costs are well managed relative to the revenue base. The company's cash conversion is middle-of-the-road — sufficient for operational needs, but leaving limited surplus for discretionary allocation. Margins indicate a company that is operating effectively in some areas while still showing efficiency gaps in others.

Projected 12-month EPS growth of 51.0% adds a powerful forward signal — analyst consensus expects earnings to accelerate materially, which, if delivered, could make current multiples look increasingly modest. Turning to growth and analyst expectations, TTM revenue growth of 42.55% pointing to sustained and broad-based revenue growth within the company, while the estimated 12-month price change of 34.05%, where analyst targets indicate a strong re-rating opportunity from current prices. The distinction matters: revenue growth tells you what the company are doing, price targets tell you what analysts think the market will pay for it. Ultimately, the alignment between revenue momentum and analyst targets will depend on execution quality and the broader rate and sentiment environment. The estimated 12-month price change is based on analyst consensus price target estimates, sourced from publicly available data, and should not be interpreted as a reliable prediction of future performance.

The quantitative profile, taken as a whole, is above average on virtually every dimension that matters for long-term return generation.

This assessment is based solely on the quantitative metrics presented above and does not constitute financial advice. Investors should consider their own risk tolerance and conduct independent research before making investment decisions.